Hot Currency Trade of the Day - 11/4/08

Hot Currency Trade of the Day - 11/4/08

Entry: Long EUR/JPY on a break above 128
Target: 135.17 (50% fib of 156.82-113.60)
Stop: Below 126.50

Stock markets in Europe are picking up pace while DJIA and S&P 500 futures are signaling a strong open today, suggesting an improvement in investor sentiment that could benefit the JPY crosses throughout the day. Focusing on EUR/JPY, the pair continues to consolidate just under trendline resistance on the hourly charts at 128. I'm looking for EUR/JPY to break above that level to target 135.17 (the 50% Fibonacci retracement level of 156.82-113.60). However, with the ECB scheduled to announce their rate decision on Thursday morning, I would try to exit the trade before then.

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